The first thing we can look at is the geographical risk distribution of the portfolio before and after the rebalance,we can see there was a slight increase in the two biggest investment risk countries, Canada has signifcantly moved up the ranking and a there is a decrease in the countries in which risk was less present before. To investigate this further we can define the increase by geographical region.
Now we can clearly see the increase in Canada, as well as the slighter increases in other countries.
Most notable is the change in Israel, which has decreased significantly. This may be due to instability in the area leading to increased risk.
Broadly, there seems to be a diversification to outside of Europe.
To get a final overview of the hierarchy in the portfolio we can examine a box-plot of the industry standard classifications to get a good idea of which areas of investment have increased and decreased in the portfolio for diversification.
We can see the strongest increase in Automotive Retail and Industrial REITs, automotive as a broad category appears green across the plot, which may be compensated for by the increased invesment in Tesla. This may be a 'bubble', to hedge this investment and negate some risk an investment such as REITS holds value regardless of inflation. Overall there is a decrese in investment in hypermarkets, 'metals and mining' and reinsurance. Likely these could be traced back to the pandemic changing risk profiles, for eaxmple the hypermarket decrease could be due to the pandemic making large stores more risky to visit.
If we plot the metric at which the analysts place their sentiment against the change in portfolio we can see that regardless of analyst opinion, there is more to the choice. Particulatly we can look at the size and color of the bubble to determine the magnitude of change.
Tesla gained a large amount as we saw in the cetegories plot as well, while Emerson Electirc also saw a large increase.
On the other side of the spectrum, despite analyst approval (nonethless less than those that increased) Chevron and Eaton saw large decreases.
We will examine these companies in depth to explore the featues which weigh their various placements:
When we examine these invesments we can start to see which factors contribute to the increase in invesment, Tesla gained increased investment because of its sheer domination in the market, as seen by its cover of the plot. While the choice for Prudential is a bit more subtle. Its TotalScore(alpha) shows is performance is much larger than expected to cause such an uptick in invesment, its other features are seemingly unremarkable making its behavior difficult to predict beforehand. For the companies that the portfolio steered away from, Dividend_Yield seems to be a large factor, perhaps these shares are not worth investing in for that price when others have a lower divdend. The withdrawl in AXA may be a cash out, as the heavy investment before is now paying off with a high Dividend_Yield and ROE.